Monthly Archives: August 2017

The Top Life Financial Mistakes Made During a Startup

 

    Any sort of financial mistake can be very costly but when you are starting a business and relying on it to give you an income, you really do not want to make mistakes. Below are the top common mistakes made by start-up businesses, so that you can avoid them.

Overspending

It is so easy to overspend when you start a business. There will be things that you need to buy, but these do not have to be hugely expensive. Negotiate on prices for everything and try to do everything that you can yourself. There is a lot of information on line about free marketing and bookkeeping, so you can do these things yourself and save a lot of money. Do not be tempted to buy things that you do not need.

Not saving

It is so important to put some money by. If you get expenses that you cannot manage, then you have some money to fall back on. It can make such a difference, not only to your business if you do get a bill in, but also to your peace of mind. Put the money in a business savings account so that you are not tempted to spend it on personal things.

Personal loans

Many new business holders are tempted to use personal loans such as payday loans to help the business grow. They will borrow money and then use it to pay their personal expenses while the business is not doing well or use it to pay for things for the business. This can often lead to problems in making repayments and can cause the business to have to fold. So avoid these as much as you can.

Not having personal savings

Having personal savings is very important when starting a business. It is unlikely that you will be able to pay yourself very much for a while and so you will need some money to use to cover your bills and other living expenses. Be sure to have at least enough to cover a few months of expenses so that you can do this.

Drawing too much out

It can be tempting to draw money out of the business to pay yourself right from the start. Although this is the point of running a business; to generate an income, you need to be prepared to invest money back in. You will need to pay for things for the business and you will not be able to get the business moving if there is not money available to do this.